Does the Alloy FDD specify if the 'PRINCIPAL ACKNOWLEDGMENT' is required before or after signing the franchise agreement?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
- The Acknowledgment Addendum attached to the Area Development Agreement (and specifically stating that it is not for use in the State of Illinois) is unenforceable under Illinois law because it may have the effect of forcing a franchisee to waive or release certain rights that you as a franchisee have under the Illinois Franchise Disclosure Act, 815 IL § 705.
Source: Item 23 — RECEIPTS (FDD pages 69–245)
What This Means (2025 FDD)
Based on the 2025 Alloy FDD excerpts, there is no explicit mention of a 'PRINCIPAL ACKNOWLEDGMENT' form or any specific requirement regarding when it should be signed in relation to the franchise agreement. However, the document does include addenda for certain states like Illinois that address acknowledgments and waivers of rights.
Specifically, the Illinois addendum states that an 'Acknowledgment Addendum' attached to the Area Development Agreement is unenforceable in Illinois if it forces a franchisee to waive rights under the Illinois Franchise Disclosure Act. This suggests that Alloy may use such an acknowledgment in other states, but the FDD excerpts do not detail the timing of its use.
A prospective Alloy franchisee should ask the franchisor directly about any 'PRINCIPAL ACKNOWLEDGMENT' forms, their purpose, and when they are required to be signed. It is important to understand what rights, if any, are being acknowledged or waived by signing such a form and to seek legal counsel if there are any concerns.